Amundson Ex Rel. Amundson v. Wisconsin Department of Health Services

In the

United States Court of Appeals
For the Seventh Circuit

No. 13-1351

M ICHAEL A MUNDSON, by his guardians Ella and
Richard Amundson, et al.,
Plaintiffs-Appellants,
v.

W ISCONSIN D EPARTMENT OF H EALTH S ERVICES, et al.,

Defendants-Appellees.

Appeal from the United States District Court
for the Western District of Wisconsin.
No. 12-cv-609-bbc—Barbara B. Crabb, Judge.

A RGUED JUNE 5, 2013—D ECIDED JULY 10, 2013

Before EASTERBROOK, Chief Judge, and BAUER and
HAMILTON, Circuit Judges.
E ASTERBROOK, Chief Judge. In 2011 the State of
Wisconsin decided to save money by reducing the sub-
sidies for the Wisconsin Care Program, which among
other things funds disabled persons who live in group
homes. (Wisconsin makes block grants to organiza-
tions such as Community Health Partnership, Inc.,
2 No. 13-1351

which administer the programs. Although these inter-
mediaries are responsible for many choices about how to
allocate available funds, we simplify this opinion by
assuming that the state itself made all of the decisions.) The
cuts, which took effect in January 2012, fell most heavily
on groups whose care is most costly. The plaintiffs in
this suit are developmentally disabled and bore the
largest cuts. Persons who had been receiving smaller
payments bore smaller cuts; and for some (such as those
classified by one intermediary as frail elderly) per capita
payments increased. Plaintiffs contend that making larger
absolute cuts for persons whose care is most expensive
violates both the Rehabilitation Act and the Americans
with Disabilities Act. They also contend that reduction
in the state’s payments increases the risk that they will
be moved from group homes to institutions, which
they say would violate both statutes.
Plaintiffs asked the district court to issue an injunc-
tion that would require Wisconsin to restore the pay-
ment schedule that was in force until 2012. A request for
money from the state naturally led to questions about
the scope of state sovereign immunity under the
eleventh amendment. The district judge did not see
any problem with the claim based on the Rehabilitation
Act, for states have waived their immunity as a condi-
tion of receiving federal funds. See Stanley v. Litscher,
213 F.3d 340, 344 (7th Cir. 2000). But the ADA does
not require states to give up their immunity in trade for
grants. The Supreme Court has held that the portions of
the ADA that are not designed to implement disabled
persons’ constitutional rights are not based on §5 of the
No. 13-1351 3

fourteenth amendment and thus cannot be used to over-
ride states’ sovereign immunity. Compare University of
Alabama v. Garrett, 531 U.S. 356 (2001), with Tennessee v.
Lane, 541 U.S. 509 (2004). The district court concluded
that the provisions of the ADA that plaintiffs invoke
do not concern the Constitution and therefore are not §5
legislation. That left the possibility of prospective relief
against state officials under Ex parte Young, 209 U.S. 123
(1908). But the district court held that an order to pay
money is never proper under Ex parte Young and that
the ADA therefore drops out of the case.
We doubt that this issue matters. Throughout its
opinion, the district court stressed that the Rehabilita-
tion Act and the ADA are substantively identical with
respect to plaintiffs’ claims. See Jaros v. Illinois Department
of Corrections, 684 F.3d 667, 671–72 (7th Cir. 2012). None
of the litigants argues otherwise in this court. This
means that the Rehabilitation Act by itself affords plain-
tiffs any relief to which they may be entitled; claims
under the ADA become academic. At all events, we
record our disagreement with the district court’s conclu-
sion about the propriety of relief under Ex parte Young.
Although “Ex parte Young cannot be used to obtain an
injunction requiring the payment of funds from the
State’s treasury,” Virginia Office for Protection & Advocacy
v. Stewart, 131 S. Ct. 1632, 1639 (2011); see also Edelman v.
Jordan, 415 U.S. 651 (1974), other forms of relief are possi-
ble.
For example, an injunction might require the state
to treat developmentally disabled persons no worse than
4 No. 13-1351

persons with other disabilities—for example, by making
the same reductions across the board. That is not what
plaintiffs seek (they would prefer to have their 2011
benefits restored), but it would eliminate discrimina-
tion. Or a district judge might spell out the minimum
housing required by federal law and leave it to
Wisconsin to determine how to fulfil its obligations. That
compliance with an injunction requiring performance,
rather than payment, may turn out to be costly has
never been an objection to the command to implement
federal law. See, e.g., Ameritech Corp. v. McCann, 297
F.3d 582, 587 (7th Cir. 2002). “In determining whether
the doctrine of Ex parte Young avoids an Eleventh Amend-
ment bar to suit, a court need only conduct a ‘straight-
forward inquiry into whether [the] complaint alleges
an ongoing violation of federal law and seeks relief prop-
erly characterized as prospective.’ ” Verizon Maryland
Inc. v. Public Service Commission of Maryland, 535 U.S.
635, 645 (2002).
To the plaintiffs’ claims. We start with their contention
that the rates now in force are too low to allow them
to continue living in group homes with non-disabled
persons. If they must move to institutions housing only
the disabled, plaintiffs contend, that would violate 42
U.S.C. §12132 and implementing regulations, which are
commonly understood to limit states’ ability to remove
disabled persons from settings generally accessible by
the public. We say “limit” rather than “prohibit” because
although Olmstead v. L.C., 527 U.S. 581 (1999), held that
institutionalization can be a form of “discrimination”
prohibited by §12132, it added that a state may be able
No. 13-1351 5

to justify institutional treatment if “the resources
available to the State” are limited. 527 U.S. at 587. That’s
the sort of justification Wisconsin invokes.
The district court did not reach the merits of plaintiffs’
claim, however, because it deemed the suit premature.
None of the plaintiffs has been placed in an institution.
Indeed, plaintiffs do not allege that any developmentally
disabled person in Wisconsin has been moved, involun-
tarily, from group to institutional care. Plaintiffs do
allege that some of their number have been required to
leave group settings where they would have preferred
to remain, but they do not allege inability to find
another group home willing to accept the level of reim-
bursement that the Wisconsin Care Program now offers.
Wisconsin believes that the changes it has made will
reduce the cost of care by excluding the highest-cost
providers from the program, but without landing any
developmentally disabled person in an institution. If
that’s so, Wisconsin has fulfilled its obligations under
federal law, no matter how much plaintiffs prefer the
comfort and amenities of the more-expensive group
homes. And whether that is so, the district court con-
cluded, cannot be determined without more ex-
perience under the current rates. Plaintiffs fear the
worst, but their fears may be unwarranted.
We agree with the district court that this aspect of
the suit is unripe. Ripeness is a matter of timing: the
judiciary should not act prematurely or unnecessarily. If
plaintiffs’ fears come to pass, they can return to court.
If the fears do not come to pass, however, there is no
6 No. 13-1351

legal injury, and an opinion today would be advisory.
Wisconsin maintains that it has safeguards in place that
will prevent any plaintiff from being transferred to
an institution. The complaint does not give a sufficient
reason to think that these will fail.
By contrast, plaintiffs’ contention that they are being
treated worse than persons with other disabilities is
ripe. If Wisconsin buys the best available care
for persons with visual impairments, but pays only for
mediocre care for the developmentally disabled, then
plaintiffs have a theory of discrimination even though
all of them remain in group homes. The district court
stopped here, however, concluding in reliance on Grzan
v. Charter Hospital, 104 F.3d 116 (7th Cir. 1997), that dis-
crimination among disabled persons never violates the
ADA or the Rehabilitation Act. See also, e.g., Mallett v.
Wisconsin Division of Vocational Rehabilitation, 130 F.3d
1245 (7th Cir. 1997); EEOC v. CNA Insurance Cos., 96
F.3d 1039, 1044 (7th Cir. 1996). Grzan held that a
disabled person can show forbidden discrimination
only by comparison with a non-disabled person. Plaintiffs
concede that Grzan dooms this aspect of their suit but
ask us to modify or overrule Grzan in light of the
Supreme Court’s later decision in Olmstead. They
observe that after Olmstead several appellate courts
have concluded that discrimination among persons with
different disabilities can state a good claim. See, e.g.,
Henrietta D. v. Bloomberg, 331 F.3d 261, 274 (2d Cir. 2003);
C.O. v. Portland Public Schools, 679 F.3d 1162, 1169 (9th
Cir. 2012); Johnson v. K Mart Corp., 273 F.3d 1035, 1053–54
(11th Cir. 2001).
No. 13-1351 7

Olmstead indeed supersedes Grzan, for two reasons.
First, the Justices observed that they have allowed intra-
class claims of discrimination. Olmstead gives as an ex-
ample O’Connor v. Consolidated Coin Caterers Corp., 517
U.S. 308, 312 (1996), which concluded that discrimination
against older persons within the class of all persons
protected by the Age Discrimination in Employment
Act—say, favoring 45 year olds over 60 year olds—could
violate that statute. Olmstead, 527 U.S. at 598 n.10.
Second, and more important, the Court held that the
word “discrimination” as used in §12132 includes not
only disparate treatment of comparably situated persons
but also undue institutionalization of disabled persons,
no matter how anyone else is treated. 527 U.S. at 597–603.
Grzan thought that “discrimination” requires a com-
parison to the treatment of someone outside the
protected class; Olmstead holds otherwise.
This is as far as plaintiffs get, however, because they
have not offered any comparison group or any standard
by which “worse treatment” could be identified. Before
the change made in 2011, developmentally disabled
persons received greater subsidies than any other sub-
category of the disabled. The 2011 revisions cut their
subsidy, but plaintiffs do not contend that they are now
treated worse than some other set of disabled persons.
Suppose it costs at least $50,000 a year to provide for
care of a developmentally disabled person in a group
home and more (say, $75,000) to pay for top-quality
group care. Suppose that it costs only $40,000 a year to
provide for care of a blind person in a group home. Finally,
8 No. 13-1351

suppose that until 2011 Wisconsin was paying $75,000
a year for each developmentally disabled person and
$40,000 a year for each blind person, but that in 2011
the payments were cut to $50,000 and $40,000 for these
groups. Although one group lost money and the other
did not, this would not be discrimination against the
developmentally disabled; it would instead be the end
of discrimination in favor of the developmentally disabled.
If care for dyslexia costs only $5,000 a year for several
years, then nothing after training is completed, it would
amount to “discrimination” to provide greater pay-
ments for dyslexics than for the developmentally dis-
abled. But plaintiffs do not say that the amount provided
for their care is below what Wisconsin provides
for some other disability that is less expensive to cope
with. They do not even say that they are receiving a
lower percentage of the cost of their care than persons
with other kinds of disabilities do.
Instead, plaintiffs’ theory is that any reduction that
leaves them unable to remain in group homes that their
physicians or other providers think the optimal place-
ment for them is forbidden “discrimination.” That is
untenable, unless the state is providing other groups
of disabled persons with whatever care, in whatever
location, their physicians most favor, and plaintiffs
do not contend this. Plaintiffs tell us nothing about
what kind of care persons with other disabilities
receive in Wisconsin. Their sole argument is that
Wisconsin reduced their own subsidies. Apart from the
possibility (which is unripe) that the reduction may lead
No. 13-1351 9

to undue institutionalization, this is not a theory of
“discrimination” at all. It is a claim of absolute entitle-
ment. Perhaps such a claim could be made under the
Medicaid Act (a principal source of funds for the Wis-
consin Care Program), but plaintiffs told the district
court, and repeated at oral argument on appeal, that
they are not contending that Wisconsin has violated the
duties it assumed when joining the Medicaid program.
In sum, plaintiffs’ contention that Wisconsin’s decision
will lead to their institutionalization is unripe, and their
contention that Wisconsin has discriminated in some
other way founders for lack of a useful theory of “dis-
crimination.” The judgment of the district court accord-
ingly is affirmed.

7-10-13